80D Benefits on your Medical Insurance Policy - Niva Bupa

Having a medical insurance policy can provide you with financial security in case of any medical emergency or illness. It can cover your hospitalisation expenses, surgery costs, and other medical expenses, which can otherwise be quite expensive. In addition, you can avail tax benefits on your medical insurance premiums under section 80D of the Income Tax Act in India.

Under section 80D, you can claim a deduction on the premiums paid towards a medical insurance for yourself, your spouse, dependent children, and your parents. The deduction limit depends on the age of the insured person and the type of coverage. In this blog, we will provide you with an overview of the medical insurance premium 80D deductions.

Amount of Medical Insurance Premium 80D Deduction

Benefits under this section are available for individuals and Hindu Undivided Families (HUF). It does not cover other entities, like companies, partnership firms, etc. The total deduction under section 80D cannot exceed ₹1 lakh, even if you have paid more than that towards medical insurance premiums. More details are as follows:

For individuals below 60 years of age:

• If you are paying the premium for a medical insurance policy for yourself, your spouse, and your dependent children, you can claim a deduction of up to ₹25,000 per year.
• If the premium is paid for parents (who are not senior citizens), an additional deduction of up to ₹25,000 per year can be availed.
• Health insurance for parents who are senior citizens (above 60 years), a deduction of up to ₹50,000 per year can be claimed.

For individuals above 60 years of age:

• If you are paying the premium for a medical insurance policy for yourself, your spouse, and your dependent children, you can claim a deduction of up to ₹50,000 per year.
• For parents (who are not senior citizens), an additional amount of up to ₹50,000 per year can be deducted.
• If your parents are senior citizens (above 60 years), a deduction of up to ₹1 lakh per year is available to you.

Eligible Payments under Medical Insurance 80D

We have so far discussed the treatment of the 80D medical insurance premium. With regard to that, you must note that cash payments are not eligible for this deduction. Payments must be made using modes like cheques and electronic payments.

To improve the health outcomes of senior citizens, the government has also allowed medical expenditures incurred on them to be deducted. Such elderly people must, however, not be covered under any medical policy. Similarly, to promote Central Government Health Scheme or other schemes notified by the government, scheme contributions are covered.

In order to avoid any complications in your tax return filing, you should also remember that GST and cess charges levied on premiums can not be claimed. Further, relatives other than parents and dependent children can not be included. Group health insurance premium paid on behalf of employees is also not eligible for tax benefit.

Document Requirements for Claiming Medical Insurance Premium 80D Deductions

Although documentation proof is not mandated under this section, it is prudent to maintain some basic documents. This may include health insurance premium receipts, hospital bills, medical expense receipts, etc. Such basic records will prove useful while filing Income Tax Returns (ITR) or when your employer issues Form 16.

Wrapping Up

The taxation policy in India, through Section 80D, aims to increase the insurance penetration rate in the country. To get the most out of your mediclaim coverage, it is also essential that you choose the right insurer. Niva Bupa offers medical policies that prioritise consumer experience by meeting diverse needs. With a claim settlement ratio of above 90% and a 30-minutes settlement process, Niva Bupa plans ensure that policyholders get timely assistance during medical emergencies. So, why wait? Get insured with Niva Bupa now.

FAQ

Is a cash payment eligible for tax deduction under 80D?

No, any health insurance premium paid in cash is not eligible. Only payments made through banking modes like cheque, UPI, or credit card are valid for deductions.

Can medical bills be claimed without an insurance policy?

Yes, for senior citizens not covered by any policy, out-of-pocket medical expenses are eligible for deduction under 80D. This encourages preventive care and better health for the elderly.

Is documentation mandatory for 80D deductions during ITR filing?

Documents are not required while submitting your tax return, but it is best to keep receipts, hospital bills, and payment proofs handy in case verification is ever needed.

Can senior citizens claim ₹1 lakh under 80D?

Yes, senior citizens who pay premiums for themselves and their senior citizen parents can claim a maximum deduction of ₹1 lakh under Section 80D every financial year.

What documents do I need to submit to get a health policy?

To buy a policy, you usually need identity proof, address proof, income documents, and sometimes medical reports. Each insurer may ask for different documents based on age and health.

Can medical bills be claimed without an insurance policy?

Yes, for senior citizens not covered by any policy, out-of-pocket medical expenses are eligible for deduction under 80D. This encourages preventive care and better health for the elderly.